Europe's Contribution To Global Profits Has Gone Off A Cliff

Economic growth has been anemic, and some economies in the
eurozone are already contracting.

Meanwhile inflation, which is one of the European Central Bank's
main goals, has been tepid. On Monday, former Bank of England
economist Tony
Yates wrote that the eurozone may have already fallen into
deflation.

And just last week, the Organization for Economic Cooperation and
Development, or OECD,
published its latest growth projections for the global
economy, which showed the eurozone growth lagging other major
economies.

This report also said the ECB needs to act to head off deflation,
and while ECB president Mario Draghi last week reiterated the
central bank's intentions to increase the size of its balance
sheet, it remains to be seen if these actions will be effective.

In a note to clients over the weekend, however, Bank of America
Merrill Lynch strategist Michael Hartnett highlighted an even
more troubling chart for Europe, which shows the declining
percentage of global earnings coming from Europe.

"25 years on from the fall of the Berlin Wall, and Europe is
arguably one recession away from severe political and social
stress," Hartnett wrote.

And signs of this stress have already popped up, as over the
weekend 81% of voters in Catalan voted in favor of independence
from Spain.

But aside from any one economic or political force, one thing is
clear: the European economy is is decline.